The Inter Milan playmaker's wage demand is too high, and neither United nor City are willing to break salary structure, throwing transfer window wide open.
Wesley Sneijder's England move unlikely
Neither Manchester City nor Manchester United consider it viable to match the playmaker's £200,000 (Dh1.2 million) basic weekly wage at Inter Milan as well as paying a transfer fee of £30m to £35m to the Serie A club.
United ended their long-standing interest in Sneijder following a series of unsuccessful attempts to structure a financial package that would fit the player into their carefully controlled wage structure.
With Sneijder's after-tax salary standing at £5.25m and substantial bonuses on top, David Gill, the chief executive, has declared an end to the negotiations.
City also wanted Sneijder, entering discussions with the player's representatives about a transfer. Yet despite having a pay ceiling capable of accommodating Carlos Tevez's hefty salary, they have declared the overall cost of a move prohibitive and focused efforts elsewhere.
Yesterday's report in respected Italian daily Gazzetta dello Sport that City had agreed to pay ?36m (Dh188m) for Sneijder surprised the player's agent, and was treated by City and United as an attempt by Inter to force the latter club's hand.
United, however, have never gone as far as discussing a transfer fee with the Italians.
Manchester City's principal target for a creative midfield berth remains Samir Nasri, who they believe could be extracted from Arsenal with an offer approaching £22m. City have already agreed terms with Nasri's representatives as well as substantial commissions on the transfer.
Though Arsene Wenger has blocked the sale to date, Arsenal's board are concerned Nasri will leave the club on a free transfer when his contract expires next summer.
The argument that they should take a profit on the 24 year old by selling now has gained traction with the player making himself unavailable for recent pre-season fixtures.
The club are also struggling to resolve their difficulties with another disgruntled midfielder, Cesc Fabregas. Arsenal's captain has barely trained with his teammates during a close season in which his attitude has been severely questioned.
While Wenger has accepted that it would be prudent to allow Fabregas to return to Barcelona, the Catalans' latest offer of an initial £26.1m plus a further £7m in performance-related variables has been rejected.
Arsenal are expected to invest part of the revenue from transfers on trying to sign the Spain forward Juan Mata. Though they missed a July 31 deadline to trigger a £20m buyout clause in Mata's contract, Valencia are expected to accept an offer in the region of £26m for the 23 year old.
While Mata is keen on a move to Arsenal he also harbours hopes that an indirect approach from United could turn concrete following their failure to land Sneijder.
Asked about United's approach for Sneijder last week, Ernesto Paolillo, the Inter chief executive said: "I'll repeat it; this is only spoken of in the newspapers, and we're not talking about it. He's an integral part of our team and there are no negotiations."
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